Real Estate Math
A Minnesota investor purchases a 4-unit property for $340,000. Each unit rents for $950/month. With 100% occupancy, what is the gross rent multiplier (GRM)?
A75
B89.5✓ Correct
C74.3
D95
Explanation
Total monthly rent = 4 x $950 = $3,800. GRM = Purchase price / Monthly rent = $340,000 / $3,800 = 89.47, approximately 89.5. The GRM helps investors quickly assess if a property is reasonably priced relative to its rental income. Lower GRMs generally indicate better value for investors.
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